Sep201116

When the recession of 2008 began and politicians around the world were trying to figure out a way to dig them out of the hole, they all entertained various protectionist ideas. We all remember the ‘Buy America’ provision in the U.S. Canada was able to get an exemption from it, but the idea was already out in the open for supporters to think about.

A similar idea was mentioned in President Obama’s jobs plan earlier this month. Canada is once again trying to get an exemption from it, although it has not happened yet. For Canada, this is a crucial law. The vast majority of Canadian exports go to the U.S., roughly 75% in total. If the U.S. adopts measures that say the government can only buy from American companies it will surely hurt the Canadian economy. Canada must do everything they can to ensure that they get that exemption.

Enter Ontario NDP Premier candidate, Andrea Horwath. What is her grand plan to get Ontario’s unemployment rate down? You guessed it, a ‘Buy Ontario’ provision. At the same time that the Canadian government is trying to quietly convince the Obama administration to give Canada an exemption in the ‘Buy America’ provision, Ontario NDP Leader Horwath is trying to do the same thing for Ontario. This is an awful move in every way. Not only will it make it harder for Canada to obtain that all important exemption, it is also a terrible policy for Ontario.

It is ALWAYS better to have a fair and free market. If we institute a ‘Buy Ontario’ law, then it will only lead to higher prices and lower quality for the people of Ontario. Imagine, the Ontario government needs to buy a new product (hypothetically speaking) to help hospitals function better. Let’s pretend this product is only made in Ontario and Arizona. The Arizona made product is less expensive, performs better and has a long life span. Under a ‘Buy Ontario’ rule, the provincial government must buy the inferior Ontario product. This costs Ontarians more money, provides poorer performance for the hospitals and has to be replaced sooner which will cost even more money. On top of that, the ‘Buy Ontario’ provision angers the U.S. and results in Canada not obtaining an exemption to the ‘Buy America’ rule. The end result is a possible Ontario led- Canadian recession. Good going Leader Horwath.